Bill Ackman's letter to the Rating Agencies

"Does a company deserve your highest Triple A rating whose stock price has
declined 90%, has cut its dividend, is scrambling to raise capital, completed a
partial financing at 14% interest (now trading at a 20% yield one week later), has
incurred losses massively in excess of its promised zero-loss expectations wiping
out more than half of book value, with Berkshire Hathaway as a new competitor,
having lost access to its only liquidity facility, and having concealed material
information from the marketplace?

Hes probably right on the extend of the losses, what nobody knows is what dinallo and co will do. merrils ceo said he will bailout them out if 'makes economic sense', well, thats the last thing a capital infusion would do. I think moodys can drop the bomb at any time but the fact that these companies had so much investment and private equity stepping in adds the risk of shorting them if dumb money buys them out, if the government provides some kind of 'incentive' the deals could go through

I think this could happen. if there is no capital, dinallo might be forced to auction the municipal insurance agreements of these companies to guys like buffett so the muni market doesnt collapse, I'm not sure he has the authority to do this though